Obama Administration Releases ‘Blacklisting’ Proposal

The Federal Acquisition Regulatory (FAR) Council released a proposed rule and the U.S. Department of Labor (DOL) issued proposed guidance May 27, as directed by President Obama’s July 31, 2014, sweeping “blacklisting” Executive Order 13673 targeting the federal contracting community.

“This rule creates a murky federal acquisition system that is absurdly cumbersome and allows contracts to be awarded in a subjective nature by unelected bureaucrats,” said ABC Vice President of Government Affairs Geoff Burr. “The ‘blacklisting’ proposal released today will unnecessarily complicate the federal acquisition process by adding undue subjectivity and may result in some of the best federal contractors being blacklisted from winning future contracts. Additionally, the administration’s latest assault on federal contractors via illegal executive overreach will result in more bid protests and more frequent and costly labor and employment disputes.

“Taxpayers, contractors and their employees deserve a fair and transparent process that will award contracts to firms that will deliver the highest quality product at the best price, however, this proposal is a clear step in the wrong direction,” said Burr. “Today’s proposal will discourage small businesses from pursuing federal contracts; threaten the livelihood of millions of Americans employed by federal contractors; and expose taxpayers and businesses to increased costs and risk. We are committed to fighting this proposal in the courts, Congress and through any additional avenue.”

ABC has consistently opposed the blacklisting proposal since the White House issued the Fair Pay and Safe Workplaces Executive Order 13673 in July of 2014. ABC officials spoke out against the executive order in an Oct. 13, 2014, White House listening session hosted by DOL Secretary Thomas Perez, Director of the White House Domestic Policy Council Cecilia Muñoz and Deputy Director at the Office of Management and Budget Beth Cobert. ABC also joined 19 other business trade groups in sending a Nov. 6, 2014, letter to Secretary Perez and Director Muñoz requesting the president withdraw the Fair Pay and Safe Workplaces executive order.

In addition to opening the door to favoritism and abuse of government contractors by administration officials, the proposed rule also adds an enormous compliance burden on prime contractors and subcontractors seeking federal contracts.

ABC’s General Counsel Maury Baskin will host a webinar at 2 PM on Monday, June 8, 2015, to review the FAR and DOL regulations and answer questions from the federal contracting community.

The public has 60 days to submit written comments on the FAR’s proposed rule and DOL’s proposed guidance. A final rule and guidance will be published and implemented after public comments have been reviewed.